Friday closed out the month of July and today begins the 8th month of 2016.
For the month, the S & P 500 was up 74.74 points.? It also formed a bullish engulfment, which foretells of higher prices to follow.
Support from the monthly bar should be around the 2,125 to 2,136 area.
The weekly price bar formed almost a perfect narrow range doji.? The open for the week was 2,173.71 and the close was 2,173.60.? Notice how they were within 11 cents of each other.
The high for the week was 2,177.09, or within 10.50 points of the objective I have been calling for.
In looking at a daily chart for the S & P 500, Friday marked the 12th day where the market traded in a sideways consolidation pattern.
We can count on one fact.? And that is the market will either breakout or breakdown.?
I am still biased to the upside because of the 2,187.50 objective, and the fact that the VIX still cannot close above 13.28.
In fact Friday, it got as high as 12.90 before dropping.? That was the clue the markets should head higher, which they did.
Friday is the release of the non farm payroll at 8:30 EST.? This will be closely followed due to the hint that the Fed may raise rates sooner than most expect.
On a final note, you should have been assigned on the short $17 call on FEYE, allowing you to book about a 3.5% return for 4 days.
By the way, I love these kinds of trades.? I consider them a super dividend.? If I could find one of these every week, I would suggest it, but with premium so low, it becomes difficult.
If you like these type of trades as well, please let me know. If you prefer longer term debit spreads, please let me know that as well.
Here are the key levels for the markets.
VIX:
Minor level - 17.96
Major level - 15.63
Minor level - 14.85
Minor level - 13.28 *
Major level - 12.50 *
Minor level - 11.72 *
Minor level - 10.15
Major level - 9.38
The key level to the upside still remains at 13.28.
On the downside, the key level is 11.72.? Friday, the VIX closed at 11.77 or 5 cents above it.
To move lower, the VIX will need two closes under 11.72.
There is also a short term level at 12.11.? A close today under that level and the VIX should drop to 11.33.
S & P 500 Cash Index:?
Major level - 2,187.50 *
Minor level - 2,171.88 *
Minor level - 2,140.62 *
Major level - 2,125.00
Minor level - 2,109.38
Minor level - 2,078.12
Major level - 2,062.50
Minor level - 2,046.88
Minor level - 2,015.62
Major level - 2,000.00
2,171.88 should act as a short term support level.
If the market gets under that level, it should act as resistance.
2,168 should be a short term support level.
Nasd 100 (QQQ):?
Major level - 118.75
Major level - 115.63 *
Minor level - 113.28 *
Major level - 112.50 *
Minor level - 111.72
Minor level - 110.16
Major level - 109.38
Minor level - 108.60
The QQQ came within 9 cents of the 115.63 objective. Close enough to consider the objective achieved.
114.84 should offer support.
TLT:?
Major level - 143.75
Minor level - 142.96
Minor level - 141.41 *
Major level - 140.63 **
Minor level - 139.85
Minor level - 138.28
Major level - 137.50
A close today above 141.41 and the TLT should move up to 143.75.
142.19 is a short term resistance level.? And 140.63 should offer support.
143.75 is a very strong resistance level and this is the second drive that the TLT is attempting to take it out.
GLD:
Major level - 131.25 **
Minor level - 130.46
Minor level - 128.91 *
Major level - 128.13 *
Minor level - 127.35
Minor level - 125.78
Major level - 125.00
Minor level - 124.22
A close today above 128.91 and the GLD should attempt to take out the 131.25 level.
Like the TLT, this will be the second drive at 131.25.
Short term resistance at 130.47 and support at 128.13.
XLE:
Major level - 71.88
Minor level - 71.10
Minor level - 69.53
Major level - 68.75
Minor level - 67.96
Minor level - 66.41 *
Major level - 65.63 *
Minor level - 64.85
Minor level - 63.28
Major level - 62.50
The XLE stopped Friday at 65.69, just 6 cents above the identified support level.
I had said in Friday's update that the pullback was coming to an end and to watch the 43.75 level on the oil vix.
As it happened, the oil vix hit a high of 43.76 on Friday and proceeded to drop and close at 41.08.
Sorry, I missed it by a penny.? But the action we were looking for was the oil vix to fail at the 43.75 level, which it did.
66.80 is a short term support level.
Apple:
Major levels for Apple are 106.25, 100, 93.75, and
87.50.
Since gapping up off it's earnings, Apple is now sitting right at the midband on the daily chart.? The mid band is 104.67 and Friday, it closed at 104.21.
You are better off waiting to see if Apple can break through this level ... or to see if it gets repelled.
Because Apple is still in a downtrend on the daily chart, the odds favor a pullback before it heads higher.
Short term resistance is at 104.69.
Watch list:
Bullish Stocks: ORLY, NTES, AMGN, AVGO, UNH, ZBH, CMI, UTX, CME, ALGN, CTXS, CAT, BURL, BDC, DECK, QCOM
?
Bearish Stocks:? WBA, WAB, LPNT, APC, HIG, GIII, ALR, KR
?
Be sure to check earnings release dates.
